Do you need to change your adviser marketing under MiFID II?

Jan 28th '18

An article in this week’s Money Marketing suggests that you might.


Confusion around new inducement rules under MiFID II is causing providers to review their marketing targeted at advisers via conferences and on websites.


We look at what’s caused the uncertainty and what you may need to do as a result.


  • What does MiFID II say about marketing to advisers?

When MiFID II came into force on 3 January, it brought in new requirements around financial promotions.


It also introduced more stringent rules around ‘non-monetary benefits’ from providers to advisers, which are detailed in the Financial Conduct Authority (FCA) Conduct of Business Handbook under rule 2.3A.


As a result of this, Money Marketing reports that ‘Providers are reviewing their marketing packages to advisers at conferences and on websites amid concerns they will fall foul of new inducement rules under Mifid II’.


Not all firms are clear on how the inducement rules should be applied, which has led to different providers interpreting them in different ways.


  • What aspects of MiFID II are causing confusion?

Firms are particularly unclear on how the rules should be interpreted in relation to providers financially contributing to conferences run by advice firms. There is also uncertainty around providers paying to have content published on adviser websites.


There are two issues here:


First, the question of hospitality.


Here the new Directive, in the words of an FCA policy statement ‘tightens the acceptable hospitality perimeter. It states that hospitality is acceptable if it is ‘of a reasonable de minimis value, such as bard and drink during a business meeting or a conference, seminar or other training events … [such as] … participation in conferences, seminars and other training events on the benefits and features of a specific financial instrument or an investment service’.


Second, and a bigger problem in the view of some quoted in the Money Marketing article, is the issue of sponsored content on adviser websites or in newsletters.


In the past, advisers have allowed providers to include content on their websites or in newsletters for a fee. While this is still possible under MiFID II, the rules mean that it has to be done at cost.


This potentially removes a potential revenue stream for advisers. And because – according to the article – these changes haven’t been as well publicised as others MiFIDII has introduced, there’s a strong chance that some providers and large advice firms aren’t compliant.


With firms needing to make a host of changes to comply with the new Directive – including changes to professional client communications – there is a chance that some of the tightened requirements around promotions via adviser websites, newsletters and events may have been missed.


  • What do you need to do?

Audit your current activity – do you market by sponsoring advisers’ conferences or events? Do you pay to include articles, marketing materials, adverts or thought pieces on their websites?


If so, you should make sure you’re familiar with the requirements. Take any steps needed to adjust your approach so you remain compliant.


How can we help?

At LS Consultancy, we offer a complete solution with a range of cost effective, regulatory compliance and marketing products and solutions that are uniquely suited to supporting firms.


Explore our full range today.


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